From Passion to Profit: How Much Money Can Custom T-Shirts Make?

Have you thought about starting a clothing brand? Or perhaps you’re already in the industry and looking to maximize your profit? 

Today we’ll explore the world of custom t-shirt businesses and answer the fundamental question: “How much money can custom t-shirts make?’’

Truth be told, selling t-shirts online is no walk in the park. However, print-on-demand services such as Printful have streamlined the process, making it more accessible and easier to manage. 

That being said, there are several important questions that arise when considering this business model. What are the estimated costs? How about profit margins? Which platforms or marketplaces should you choose?

We’re here to answer it all.

Estimated costs

We’ll start by examining the estimated costs for some of the tees that are considered the best t-shirts for printing. Additionally, we’ll cover platform and transaction fees, which are crucial aspects of the financial planning for your business.

Product and fulfillment costs

When you’re selling custom t-shirts, understanding product, and fulfillment costs is crucial. Let’s break down the costs of t-shirt printing and embroidery, taking into consideration different sizes.

Bella + Canvas 3001

The Bella + Canvas 3001 t-shirt is an industry staple, a popular choice for all t-shirt businesses looking to offer high-quality, stylish apparel.

Made from soft and comfortable materials, it’s a hit among customers who appreciate comfort and fashion. The production cost for Bella + Canvas 3001 t-shirts varies according to size and the chosen fulfillment method, as shown in the table below.

*Discounts available with Printful Growth membership

Gildan 5000

Gildan 5000 t-shirts are well-known for their durability and affordability. No wonder this tee often appears in the “trending t-shirts’’ section.

These tees are available in a wide range of sizes and are suitable for various customization options. The production cost differs based on size and whether you choose to add printing or embroidery, as indicated in the table below:

*Discounts available with Printful Growth membership

Stanley/Stella Organic

Stanley/Stella Organic t-shirts are an excellent choice for those who prioritize sustainability.

These shirts are made from organic materials, catering to the environmentally conscious customer. Add a custom t-shirt design and logo, and now you have an eco-friendly fashion staple. As with the other tees, the cost of Stanley/Stella Organic t-shirts depends on size and whether you opt for printing or embroidery.

Here’s a breakdown of the production costs:

*Discounts available with Printful Growth membership

Comfort Color 1717

Comfort Color 1717 t-shirts are beloved for their relaxed, comfortable fit and wide selection of colors.

These tees offer an excellent canvas for your t-shirt design ideas. When determining the cost of producing these shirts, you’ll have to consider the size and additional costs for printing or embroidery.

Here are the production costs for Comfort Color 1717 t-shirts:

*Discounts available with Printful Growth membership

Platform and marketplace costs

The choice of your sales platform is important, as it can significantly affect your business expenses.

Shopify is well known for its user-friendly interface, which empowers you with the tools to curate a branded shopping experience. However, it comes with a monthly subscription fee.

On the flip side, Etsy is a pre-established marketplace filled with artistry and craft, where you can see other like-minded enthusiasts. While there are no associated monthly fees, it’s worth noting that you’ll have to cover listing fees to sell on Etsy.

For those who crave an even more tailored approach, WooCommerce, an open-source WordPress plugin, allows you to mold your online store according to your specifications. Plus, WooCommerce is free.

The decision depends on your sales platform preferences, brand vision, the level of control you desire, and your budget.

Transaction fees

When building a t-shirt business, remember that transaction fees vary across different sales platforms.

If you prefer Etsy, remember that this platform will impose a transaction fee of 6.5%.

Shopify has simplified this aspect by introducing Shopify Payments, which means zero transaction fees for your store. However, if you opt for a third-party payment provider, there will be additional charges of 2%, 1%, or 0.5%, depending on your Shopify plan and the nature of the transaction.

WooCommerce fees differ based on various factors, including but not limited to the country your business is located in, the country your customer is located in, as well as the currency and payment method your customer uses. 

Average t-shirt profit margin

Calculating the profit margin for your custom t-shirt business is a nuanced endeavor, with numerous factors coming into play. Your niche, target audience, t-shirt production expenses, and shipping costs all contribute to the equation.

While captivating designs often allow for higher profit margins, a more conservative approach might be necessary if you’re competing in a saturated market. It’s important to understand that this industry has no one-size-fits-all profit margin. Custom t-shirt business profit margins typically range from 30% to 50%.

Let’s put this into perspective and calculate the average profit margin.

Begin by calculating your total revenue, representing the income generated from t-shirt sales. For instance, if you sell 100 t-shirts at $20 each, your revenue would amount to $2,000.

Next, estimate your production costs, including materials, printing, shipping, and any per-sale transaction fees. Assuming the cost per t-shirt is $14, your total cost estimate would be $1,400.

Lastly, subtract your production costs from your revenue to find the gross profit: $2,000 - $1,400 = $600. Armed with these key metrics, calculating the gross profit margin is straightforward: $600 / $2,000 = 0.3, or simply put, that’s a 30% margin.

If you want to go one step forward and check the business’s financial health, the next move would be to factor in operational expenses and taxes to determine your net profit.

Valuable read: How to Start a Print-on-Demand T-Shirt Business

Your selected profit margin is pivotal to your business’s financial success. Whether your strategy involves high-volume sales with a lower margin or the opposite, a strong grasp of your financial metrics is non-negotiable.

Optimizing t-shirt pricing for online retail success

Your t-shirt pricing can make or break your online sales. Do this wrong, and you’ll send potential buyers running.

Here are four pricing strategies, in no particular order, tailored for your online store:

1. Cost-plus pricing

Cost-plus pricing is a straightforward and practical method to set your t-shirt prices. This approach ensures that all your production and shipping expenses are covered while allowing you to determine your desired profit margin. 

You simply add a percentage to your total costs to arrive at your selling price. This strategy provides transparency and reliability for both you and your customers.

2. Value-based pricing

Value-based pricing focuses on the perceived worth of your t-shirts to your customers. To implement this strategy effectively, start by identifying specific buyer personas. Analyze the prices of alternative products within your niche and gather feedback from your target audience. 

This approach allows you to align your prices with the perceived value of your t-shirts, ultimately appealing to customers who see your products as an ideal fit for their needs.

3. Competitor-based pricing

Competitor-based pricing is all about keeping an eye on your rivals. To utilize this strategy, begin by identifying competitors offering similar t-shirts. Analyze their pricing structures, gather sufficient data to determine average market prices, and adjust your t-shirt prices accordingly. 

Depending on your unique selling propositions and market positioning, you can price your t-shirts slightly above, at par with, or below the competition.

4. Psychological pricing:

Psychological pricing acknowledges the emotional aspects of online retail. To effectively engage potential buyers, this strategy plays with their perceptions. Tactics include setting t-shirt prices just below round numbers, for example, $19.99 instead of $20. It also involves crafting limited-time offers that generate a sense of urgency, such as the popular “buy one, get one free’’ deal.

Incorporating the pricing strategy that best aligns with your business goals and market positioning is crucial. For some extra tips, check out our guide on 6 Tactics to Increase Your T-Shirt Business Profit Margin.

How much can you make per t-shirt?

One of the pivotal questions you must address when starting a t-shirt business is: how much money can custom t-shirts make?

The response depends on many factors, including your production expenses, pricing strategy, and your sales volume.

Let’s look at an example – we’re using Printful to sell a size M Bella + Canvas 3001 tee on Etsy.

In this scenario, total costs amount to $16.06. To achieve a 50% profit margin, we would set the retail price at $24.09.

Doesn’t look bad at all, right? Now, we just have to calculate and deduct Etsy fees.

• Etsy transaction fee: $24.09 × 6.5% = $1.57

• Etsy payment processing fee: $24.09 × 3% + $0.25 = $0.987

Voilà! Just like that, we have our profit for the sale of one t-shirt: $24.09 – $16.06 – $1.57 – $0.98 = $5.48

This is the simplest pricing method. For your business to thrive, you also have to consider the competitors and their pricing strategies, as well as the demand.

How much can you make selling 100 t-shirts per month?

Now, let’s delve into your potential monthly earnings by envisioning a scenario in which you successfully sell 100 t-shirts each month. We’ll carry forward with the Bella+Canvas example to calculate the cumulative profit generated from 100 t-shirt sales.

It’s crucial to bear in mind that this calculation focuses solely on the profit from sales and doesn’t include any marketing expenses.

For this illustration:

- Profit per t-shirt: $5.48

- Income from selling 100 t-shirts: $5.48 × 100 = $548

This straightforward calculation paints a clear picture of your potential monthly earnings, which serve as a foundational aspect of your custom t-shirt business’s financial landscape.

Start your t-shirt store with Printful

Various factors, including your product costs, selling platform, and pricing strategy influence the potential earnings from selling custom t-shirts. You can achieve a profitable and successful venture by understanding these elements and carefully planning your business.

Remember, building a sustainable business takes time, experimentation, and continuous refinement. Don’t give up at the first hurdle!

At Printful, we’re here to support you every step of the way. Whether you need reliable print-on-demand fulfillment or expert advice – we’ve got you covered. Explore our wide range of custom t-shirts and seamless integration options to sell t-shirts online, and in case you’re looking for extra info, our blog is filled with guides that’ll help you succeed.

Maximizing your profit margins is not just about making money selling t-shirts. It’s about building a sustainable and thriving business. So go ahead, try these strategies, and stay committed to delivering exceptional products.

Happy selling!

Read next:

• How to Sell T-Shirts on Amazon: From $0 to $1,000 a Month
• How to Sell T-Shirts on Shopify in 2024
• How to Sell T-Shirts on Etsy in 6 Easy Steps